'Decade of dysfunction': business delivers blast over political crisis

By Jennifer Duke & Cole Latimer

August 22, 2018 — 4.00pm

Senior business figures spanning some of the country's biggest manufacturing, retail and resources companies have warned ongoing policy and leadership turmoil in Canberra is making it hard to plan for the future and damaging the nation's ability to attract investment.

In the fight to maintain his grip on the prime ministership Malcolm Turnbull has abandoned the Government's signature tax and energy policies, infuriating business groups seeking certainty and depriving them of billions of dollars in additional revenue.

The Coalition and business groups argue the corporate tax rate of 30 per cent for medium and large companies in Australia crimps investment and makes it harder to compete with lower-tax jurisdictions such as the United States, where President Trump has cut the company tax to 21 per cent.

“We have had a decade of dysfunction in Australia,” Wesfarmers director and Seek co-founder Paul Bassat told Fairfax Media. Wesfarmers owns supermarket chain Coles which employs more than 100,000 people.

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“First of all business likes certainty. It likes to know what the ground rules are and when there is a lack of certainty people are much more reluctant to invest."

Mr Bassat said Australia had natural strengths and opportunities that were being squandered.

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“The opportunity for Australia is really excellent and we are going to look back on the past few years as a wasted decade. We are not taking advantage of the opportunities because of a complete lack of leadership.”

Large corporations have become an increasingly popular target for Coalition policy-makers with Treasurer Scott Morrison giving in to calls for a royal commission into misconduct in the financial services industry, imposing a $6.2 billion levy on the banks and introducing new regulation of energy companies.

Former Home Affairs Minister Peter Dutton went further yesterday by suggesting a royal commission into energy prices if he ousts Prime Minister Malcolm Turnbull.

Vik Bansal, chief executive of recycling and waste business Cleanaway, which employs about 5500 people, said the saga was disappointing.

"We deserve better, we should be doing better, with the kind of economic opportunities we have right in front of us," he said.

In the space of seven days we had all and sundry agreeing to the NEG ..now its just been dusted, so we have to go back to the start

APA chief executive Mick McCormack

"From a business perspective, what we need is assurance of policy. What stops us, what makes us fearful, is a lack of clarity and ambiguity that is sadly hurting in this kind of situation. We just don’t need this."

“We’ve got a week of an implosion of what appears to be the current government,” he said.

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“It’s not good for those overseas investors looking to Australia or even if you’re doing something in Australia – particularly in energy – as the rules look like they may change and that just creates uncertainty.

“In the space of seven days we had all and sundry agreeing to the establishment of the National Energy Guarantee and climate change limits to give industry a degree of certainty in investing and now its just been dusted, so we have to go back to the start."

Ryan Stokes, the chief executive officer of Seven Group Holdings, which has investments in media and mining services, said the uncertainty undermined business confidence.

“Political uncertainty, uncertainty on major policy reform in relation to energy all has a negative impact. So I think it is something that is a factor, I don’t think it’s a good thing,” he said.

Coca Cola Amatil chief executive Alison Watkins urged a swift resolution to the political crisis to limit the damage.

“It’s extremely disappointing to see how things have degenerated in Canberra. As a business person, we would ask that our political leaders just move through this as quickly as possible and start focusing on running the country," she said.

"We would love more stability globally.. geopolitics is a challenging environment at the moment," he said.

Seek co-founder Paul BassatCredit:Fairfax Media

AMP chairman David Murray downplayed the ructions as "part of a robust democracy". "Everybody likes policy certainty, but at the very heart of things we have an election every three years anyway," he said.

Carsales chief executive Cameron McIntyre said he “doesn’t have any concerns” about the leadership disruption this week.

“If I look at consumer confidence, it has been good. Traffic has been good. There’s a fair degree of confidence out there," he said on Wednesday as the company unveiled a strong profit result.